Well, I got this message one time.
I use MM and Last Game.
At another game, the first when I used Last Game, it did a quick Black Screen and came back to XMB, with the game mounted, and then I thought it only mounted the game without a need to enter multiman and all that.
Then, I used it again with Red Dead, and it really entered into the game, and gave me this error. Just exit and start it with disc.
It should work.
The order of my error as described above:
Mounted at Disc (Working) > Last Game (Not enough memory) > Mounted at Disc (Working)
So, I got to make it work before the error, just to not lose hope.
PS2 - Matrix Infinity & HD 160GB
PSP 2000 - 5.50 GEN-D3
PSP 2000 - 5.50 Prometheus-3
PS3 Slim - CFW 3.55-jb 160GB